When does the land start to matter more than the house in Greater Victoria?
In established parts of Oak Bay, Saanich and the City of Victoria, there are properties where a significant share of the market value is tied to the lot rather than the home standing on it. Location, lot size, redevelopment potential and, increasingly, zoning can all affect that balance.
There is a point with some Greater Victoria properties where the house is no longer the main reason for the price.
You see it most clearly with an older or modest home on an unusually good lot. The house may still be perfectly livable, and it may have considerable character or appeal, but buyers are also paying for something that cannot be renovated or replaced: the location and the land underneath it.
For owners of long-held homes, and for buyers comparing properties in established neighbourhoods, understanding that distinction can change how you evaluate a property and how much sense it makes to invest in the existing house.
What does “land value” actually mean?
It helps to be precise here, because there is no single calculation that tells you exactly how much of a property’s market value belongs to the land.
BC Assessment separates a property’s assessed value into land and improvements, but those figures are prepared for property assessment purposes and should not be treated as a direct breakdown of what a buyer will pay in the current market.
From a real estate perspective, the more useful question is often this: how much additional value is the existing house contributing to the property?
For a newer home on a typical lot, the building itself may account for a meaningful portion of what buyers are willing to pay. For an older home on an exceptional lot, the equation can look very different.
If buyers would still compete strongly for the property because of its location, lot characteristics or redevelopment possibilities even if the existing house needed substantial work, that tells you the land is carrying a significant share of the property’s appeal.
That is not a criticism of older homes. Greater Victoria has many character properties that buyers specifically want to preserve and improve. It simply means the house and the land need to be evaluated separately rather than assuming every dollar spent improving the building adds the same amount to the property’s market value.
Where does this tend to happen in Greater Victoria?
There is no neighbourhood where every property fits this description.
Even within the same few blocks, lot dimensions, topography, views, trees, access, zoning and the condition of the existing house can change the equation considerably.
That said, the pattern is easier to see in established areas where land itself is particularly desirable.
In South Oak Bay and Uplands, location and lot characteristics can represent a substantial part of what buyers are paying for. Parts of Cordova Bay and Gordon Head have larger or particularly well-positioned properties where an aging house may contribute less to the overall value than owners expect. Within the City of Victoria, location can make relatively modest lots valuable even when the existing improvement is nearing the end of its useful life.
Waterfront and near-waterfront properties introduce another version of the same calculation. In those cases, buyers may place significant value on the setting, orientation and access regardless of what currently occupies the site.
The common thread is not simply that “land always goes up.” It is that certain property characteristics are difficult or impossible to recreate. A house can be substantially renovated or replaced. Its street, lot dimensions, orientation and relationship to the surrounding neighbourhood cannot.
Zoning has added another layer
Changes to housing policy have made this conversation more complicated because what a lot is permitted to accommodate can influence how some buyers evaluate it.
British Columbia’s Small-Scale Multi-Unit Housing legislation introduced through Bill 44 required municipalities to permit additional housing on many lots that were previously primarily associated with single-family or duplex use. Municipalities across Greater Victoria subsequently amended their zoning bylaws to comply with those requirements.
Further provincial changes under Bill 25 in 2025 expanded aspects of the SSMUH framework, with additional municipal bylaw updates required by June 30, 2026, except where extensions applied.
The important point for an individual property owner is that the provincial framework is only the beginning of the analysis.
The number of units potentially permitted depends on the property and the applicable municipal regulations. In Saanich, for example, eligible properties within the Urban Containment Boundary may accommodate three, four or six units depending on factors including lot size and location. Oak Bay has its own Infill Housing Program and zoning regulations.
And permitted density is not the same thing as practical development potential.
Lot width and depth, setbacks, servicing, trees, topography, access, building regulations and project economics can all affect what is realistically achievable. A property that appears attractive on a zoning map may look quite different once those constraints are considered.
For that reason, additional density should not automatically be translated into a specific increase in land value. It is better understood as another characteristic of the property that the market may value.
What this means if you are selling
If you own an older home on a strong lot, it is worth understanding the likely buyer before making major improvements for sale.
A substantial renovation can make sense when the most likely purchaser wants a finished home and values the improvements you are making. The calculation changes if some of the strongest potential buyers are primarily interested in the location, lot or longer-term possibilities for the property.
That does not mean an older home should be neglected before listing. Basic maintenance, presentation and addressing obvious condition concerns can still matter enormously.
It means the goal should not automatically be to make the house as new as possible.
Before committing significant money to a kitchen, bathrooms or other major improvements, look at what comparable properties have actually sold for, what buyers appear to be responding to and how much value similar renovated homes are achieving over properties with comparable land but older improvements.
Sometimes the house deserves the investment. Sometimes the better decision is to let the next owner decide what the property becomes.
What this means if you are buying
The same distinction matters from the other side of the transaction.
A beautifully renovated older home can absolutely be worth paying more for if the renovation saves you time, risk and construction costs and gives you a home you want to live in.
But finishes should not distract from the characteristics you cannot change.
Compare the lot. Look at orientation, privacy, exposure and neighbouring properties. Understand the zoning, but also understand whether that zoning is realistically usable. Consider the street and how the location fits your day-to-day life.
This is particularly useful when two homes at similar prices look very different.
One may have the better kitchen. The other may have the better piece of land.
There is no universal answer as to which is the better purchase. The important thing is knowing what you are paying for.
FAQ
How do I know if most of my property’s value is in the land?
There is no single ratio that answers this reliably.
BC Assessment provides separate land and improvement assessments, which can be a useful reference point, but they are not a substitute for current market analysis. Looking at recent sales of older homes, renovated homes and redevelopment properties on comparable lots can give a better picture of how buyers are valuing the land relative to the existing house.
Does Bill 44 mean I can automatically build multiple units on my property?
No. Provincial legislation required municipalities to permit additional housing on many residential lots, but what can actually be built on a specific property depends on the applicable municipal zoning and the characteristics of the site.
Lot size, location, servicing, setbacks, trees, access and other requirements can all affect what is feasible. Before assigning value to development potential, confirm the current regulations with the municipality and, where appropriate, the relevant planning or development professionals.
Should I renovate an older Greater Victoria home before selling?
It depends on the property and its likely buyer.
If buyers are primarily comparing your home with other move-in-ready properties, targeted improvements may strengthen its position. If the property attracts buyers who are placing substantial value on the lot, location or redevelopment potential, an extensive renovation may not produce the same return.
The useful question is not simply, “Will this renovation make the house better?” It is, “Will the buyer for this particular property pay enough more for it to make the investment worthwhile?”
A grounded next step
With some Greater Victoria properties, understanding the land is just as important as understanding the house.
That is especially true with older homes in established neighbourhoods, where location, lot characteristics, zoning and the condition of the existing improvement can all influence how buyers arrive at value.
If you are considering selling an older home, or comparing properties in Oak Bay, Saanich or elsewhere in Greater Victoria, Alex can help you look at the recent comparable sales, the existing house and the lot separately to understand what buyers are likely to value. Contact us.
North Pacific Homes Group, eXp Realty
Greater Victoria & South Vancouver Island
250-634-2141
Thanks for being here,
Alex Hughes, REALTOR®, Personal Real Estate Corporation — North Pacific Homes Group (eXp Realty) | Victoria, BC Real Estate
